Cydia

As the market for mobile phones continues to grow exponentially, Apple seems to earn the majority of all profits despite only selling a small minority of the world’s mobile devices. According to Horace Dediu of Asymco who performed an analysis of top handset vendors’ reported earnings, the combined operating profits from all mobile phones remained relatively stagnant below $6 billion per quarter for years until the release of Apple’s iPhone 4.

Mobile profits have skyrocketed over the last two years, jumping from $5.3 billion at the start of 2010 to $14.4 billion over the most recent quarter. The beneficiary of that explosion in mobile profits has almost exclusively been Apple. Aside from Apple and its 73% share of mobile profits, Samsung has remained to be the only contender capable of turning a profit in the industry since the release of the iconic iPhone.

Before the release of the iPhone the market leader was Nokia, with other companies such as Samsung, Sony Ericsson, LG, RIM, and HTC all being profitable. Fast forward to 2012, Nokia reported its first major quarterly loss of $1.2 billion, while former industry contenders RIM and HTC also reported poor performance. Sony Ericsson, Motorola, and LG have all failed to earn significant profits in the mobile business since the year 2009 (or earlier in some cases).

Dediu noted that Apple’s recent sure in profits “was mostly carrier premiums for the iPhone 4S,” and that most mobile carriers were even “willingly handing over these premiums because the iPhone ensures a competitive advantage or preserves their customer base from churning.” He continued to note that the “industry is rewarding those who can supply computers-as-phones which preserve the cash flows of what is necessarily a trillion dollar data services business. Vendors which cannot offer this solution saw their businesses implode. At least on the high end.”
Although Apple continues to be successful, the company’s stock remains at $581, a number significantly below the company’s all-time high of $644 per share.

S'what happens when you refuse to subsidize. Apple doesn't even have sales. Want a million 4s'? That'll be $599,000,000...plus tax. Samsung MIGHT sell their phones for $300 per unit. Doubt that much, though.

It's really ignorant when people blame Apple's profits on the factories. That is a factor in profit margins for every electronic device. About 95% of mobile electronic components are made in Asia in crappy conditions compared to Western standards.

Apple makes great products that are desirable enough to demand top dollar. They make a lot of people money and a lot of people happy. Good for them.